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Report: Low-wage fast-food jobs cost New Yorkers $708M

10/24/2013, 4:07 p.m.
A recent report by a university has recharged the batteries of the fast-food workers’ push for organization in New York.
Fast food workers fight for living wages to be put on the menu

A recent report by a university has recharged the batteries of the fast-food workers’ push for organization in New York.

New research by the University of California at Berkley revealed that in New York, the public cost of low-wage fast-food jobs is $708 million—the second highest in the country—with 60 percent of fast-food workers forced to rely on public assistance to cover basic needs. California’s public cost tops all at $717 million, with Texas ($556 million), Illinois ($368 million) and Florida ($348 million) rounding out third, fourth and fifth place respectively.

The study also revealed that full-time jobs in the fast-food industry aren’t paying enough for workers to make ends meet. Even workers who clock in 40 hours a week are still forced to rely on public assistance to cover basic needs like rent, food and health care.

Camille Rivera, executive director of the group United NY, sent the AmNews a statement responding to the report, saying that more money needs to be in the hands of workers in order for an economy that’s based on spending to be successful.

“Our economy is stronger when consumers have more money in their pockets and don’t have to rely on help from the government. If companies like McDonald’s, Burger King and Wendy’s pay workers enough to feed their kids, they’ll spend that money at local grocery stores,” said Rivera. “If these big corporations pay workers enough for them to buy clothes for their kids, they’ll spend that money at local businesses. If companies keep paying workers as little as they can get away with, the economy will never get moving again. If workers made more money, they’d spend it here in New York City and boost our local economy.”

Democratic New York City mayoral candidate Bill de Blasio said that the report reminds him why he’s pushing for City Hall to have the right to be able to establish its own minimum wage.

“As I’ve said before, New York City deserves the right to make decisions about itself in so many areas, one of them should be on the question of minimum wage,” said de Blasio in a statement.

In another report published this month by the National Employment Law Project (NELP), the 10 biggest fast-food corporations were held responsible for close to 60 percent (or $3.8 billion) of the almost $7 billion in public costs associated with their business model of low-wage and no-benefits.

In addition to that, the NELP report showed that the 10 largest fast-food companies alone made over $7.4 billion in profits in 2012 and awarded more than $53 million in compensation to their highest-paid executives, with an additional $7.7 billion in dividends and buybacks to shareholders. McDonald’s, which is the most costly fast-food company for taxpayers, is responsible for almost $1.2 billion annually in public assistance programs.

David Jones, president of the Community Service Society, said that the way fast-food companies currently do business needs to change.

“The fast-food giants are raking in profits while their workers are forced to rely on food stamps to survive,” said Jones, a research and advocacy organization that seeks to improve the lives of low-income New Yorkers. “Their business model shifts labor costs onto the taxpayers, who will not be ‘lovin’ it’ when they read this report.”